Steel flat for sale by distributors in Brazil falls in March

São Paulo – the marketing of steel flat by distributors of Brazil fell in March over a year earlier, to about 254,000 tons, according to data of the entity that represents the sector, Inda, cited by Bradesco BBI analysts in a note to clients on Monday.
According to the analysts, sales corresponded to an average per working day of 11600 tonnes, a fall of 12,8% on March 2016, but 2,1% high on Feb.
With that, in the first quarter, sales from distributors fell 8,7% on the same period in 2016, to 708,300 tons, wrote analysts Thiago Lofiego and Arthur Suelotto, Bradesco BBI.
The National Institute of steel Distributors (Inda) discloses the data to the press on Tuesday. The sector is responsible for about a third of the customer base of Brazilian steel mills.
According to the analysts, stocks of steel plan in distributors closed March 951,500 tons, compared with 918,000 tonnes in February.
The volume stored until last month was 3.7 months of sales, above the historical average of 3.5 months.
"Although we keep our view that the Brazilian market of flat steel is in a recovery trend, we believe the trend should take a volatile way," said analysts of Bradesco BBI in the report.
Analysts have cited that the domestic steel prices is embedding an award in relation to the imported material from 28%, which "implies scope for a cut of at least 10% in price for distributors".
Lofiego and Suelotto, however, do not expect reductions of rates for industrial customers, representing 70% of the client base of the mills and have not had the same level of price increases suffered by distributors.